Net benefit is maximized when marginal benefit _______ marginal cost.
A) exceeds
B) is less than
C) is equal to
D) approaches

Question

Quizplus · Accepted Answer

When marginal benefit (MB) equals marginal cost (MC), it means that the benefit received from the last unit consumed is equal to the cost of producing it. This is the point at which net benefit is maximized because any additional unit would result in MC being greater than MB, meaning that the cost of producing that unit would exceed the benefit received from it. Therefore, choice C is the best answer.

Net Benefit Is Maximized When Marginal Benefit _______ Marginal Cost